ABU DHABI // The property developers yawned while their salespeople checked their hair and told stories about last year's crowds to newer co-workers, who listened wide-eyed. The blue-carpeted walkways, once the scene of so much jostling, were largely empty except for exhibitors peeking at each other's stalls. That was the scene yesterday at the opening of the Abu Dhabi Real Estate and Investment Show at the National Exhibition Centre, where all the region's major property developers, including Hydra and Aldar, were present. There were some scattered buyers, but many people commented on how starkly it contrasted to the frenzied buying at property shows at the same venue during the height of the housing boom last year. "It is completely different to the Cityscape exhibition where people were constantly selling and you had to fight your way through the crowds," said Mohammed Akremi, 32, an investor and partner in an estate agency.
"It's just so empty. I am really surprised," he said. "Most of the projects the developers are showing here, we have seen before. They are just showing their old stuff. "What new projects they are announcing are all long-term future developments; always vague and without proper timescales." Mr Akremi said there were still opportunities to invest, but only for cash buyers. Ghassan Ibrahim, 38, an Abu Dhabi-based investor, said he had come to the exhibition to find out what impact the economic slowdown would have on his property portfolio. Property trading has been hit hard as cheap credit dries up and banks demand much higher mortgage deposits from borrowers.
Property purchases have also been affected by banks tightening their lending criteria and mortgage interest rates at eight to nine per cent. The higher interest rates are also putting a strain on existing borrowers who took out large home loans when the rates were lower. All this comes as many people are questioning their job security. Dubai house prices fell eight per cent in the last quarter of 2008, causing some analysts to warn that the UAE was facing the prospect of negative equity and home repossessions. "There are obviously a lot of developers here but there are few buyers," said Mohamad al Habech, the commercial director of Hydra Properties. "We have obviously been affected by the current financial situation; everyone has. "We have had some approaches but many of the people here seem to be existing investors who are trying to get a feel for what is happening in the market, so they can appreciate what their investments are now worth. "There is always the curiosity factor, which will draw some people in, but we certainly don't expect to be selling a great deal. "Things were always going to be tough in the current financial situation, but it is important we are here to represent the firm." The director of marketing and sales at Plus Properties, Jameel Qeblawi, said his firm had stopped trying to create new projects and were focusing on completing existing housing developments. "Our objectives here are not focused on selling, although that would of course be nice. "The reason why we are here is to show that the company is still operating. We are saying that we are here for the long term, regardless of what is happening. "There is a crisis in the international property market, but Abu Dhabi is only feeling the ripples of a problem that is focused somewhere else. We still have a healthy economy."
He added that the tough trading conditions presented an opportunity for some smaller firms, which are not reliant on bank borrowing. "Our company has no loans to maintain. There are benefits to the current situation. Construction costs have fallen and so have the prices of raw materials. "We are moving our existing projects forward and this means we are well-positioned to take advantage of this." Some developers said they had slashed their advertising budgets to reduce overheads and retraining some sales staff to work in customer service. firstname.lastname@example.org